Department of Headlines we Love

I don't even really remember Dr. Evil's scheme, but maybe you do:

WSJ: U.K. Fines Citigroup for 'Dr. Evil' Strategy:
Citigroup Inc. agreed to pay a £4 million ($7.3 million) fine and disgorge almost £10 million in profit in a $25 million settlement with the U.K.'s markets watchdog over the bank's “Dr. Evil” trading strategy that roiled European government-bond markets in August.

The big New York-based bank on Aug. 2, 2004, bought government-bond futures before selling €12.4 billion ($15.07 billion) of euro-zone government bonds on a range of electronic-trading platforms. Citigroup then bought back €3.77 billion of bonds about 30 minutes later to net about $17.5 million in profit.

Traders at the bank planned the trades, which they dubbed Dr. Evil after a character in the Austin Powers spy-spoof movies, after being encouraged by the bank “to increase profits through increased proprietary trading and the development of new trading strategies,” according to the U.K. regulator, the Financial Services Authority.

The agency added that the trades “caused a temporary disruption” on bond-trading platforms and “a sharp drop in bond prices.” Citigroup Chief Executive Charles Prince later called the trades “knuckle-headed.”

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This page contains a single entry by Seth A. published on June 28, 2005 10:15 PM.

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